Millions of employees forced to work from home because of COVID-19 turned their bedrooms, basements, and kitchens into workspaces. In doing so, they took on increased household expenses to do their jobs. The tax rules for employees claiming deductions are narrow and the CRA watches them carefully. Now, with tax filing season upon us, comes the hard part: CRA audits of employees who were not reimbursed by their employers for their home office expenses.
There are few things that individuals dread more than brown envelopes from the CRA. Almost inevitably, they contain bad news. Rarely do they include a refund cheque or thanks for contributing a substantial portion of one’s income to the government’s coffers. As we head into tax season, there are additional red flags this year that will lead the CRA to aggravate individuals, generally the most vulnerable, who claim home office deductions on account of expenses that their employers did not not reimburse.
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